Including beneficiary with mental health difficulties in a will

A question about : Including beneficiary with mental health difficulties in a will

This may not be the correct board for this question. Please move it if a different board is more appropriate.

I live in Scotland. Inheritance tax will not be an issue.

My husband and I have mirror wills, leaving everything to each other and then equally to our three adult children should we die together. Two of our children are named as executors. The third one has serious mental health and occasional substance abuse difficulties.

Unfortunately it has become increasingly apparent that his mental health difficulties are not going to improve and we are concerned about the effect simply being given a (relatively) large amount of money would have. Not only would it be completely wasted, more importantly it would be very likely to cause him harm because of the ways in which he would spend it.

We will see a solicitor to re-do our wills to try to accommodate our son's difficulties, but it would be helpful to hear views from here first. I am happy to answer any questions if I have missed out any necessary information.

Thank you.

Best answers:

• You will need to work out who you trust to be the Trustees for your child and also what constraints you may want to put on their behaviour. As you are in Scotland you can't leave him out so it's good that you are thinking about it now.
• A useful link:
  https://www.rethink.org/carers-famil...lls-and-trusts
• I would contact one of the major charities that deal with your son's problems: whether you choose a mental health one like MIND or one of the substance abuse ones, I don't really know what is available in Scotland.
  They have advisors, and sometimes have legal contacts who understand these issues and can advise you about specifics you need to consider. Of course a Trust will help him not to have access to too much money, but if he is reliant on benefits of some kind (as many people with moderate to severe mental health problems are) then you need careful planning by people who understand the system.
• One option may be to have your other children (or one of them) plus a solicitor, as trustees. This could allow for the lay trustees to do most of what might be needed, but would mean that they have the backing of a professional (and can use them as a scapegoat if they have to) if they need it. Discuss it in detail with the solicitor.
  I am not familiar with Scottish Law, but a discretionary trust with other beneficiaries (such as hi siblings, any children he may have, or his nieces and nephews) might limit both his ability to have the trust ended, and any benefits implications.
  Depending on how his mental health issues present themselves, and how much this varies, would there be any possibility of discussing it with him, when he is well?
• OP, I agree with Tbagpuss. You probably need to set up a discretionary trust.
  Unless you have reason not to trust his siblings asking them to be trustees is a plausible option with a professional as a fall back. Is there anyone else that you might trust with this responsibility?
  Remember that while you can probably rely on a reputable solicitor's firm to be trustees this could be expensive. They will probably want two solicitors to act and they will charge significant fees to carry out the duties which will eat into the capital/income. Those duties will in part depend on the instructions you lay down for the trust and how it is to be invested.
  You also need to think about what you want to happen to the trust if he were to die. The trust also has to have a situation when it is dissolved..
• My mum set up a trust fund for my sister before she died. Two family members are trustees. The fund pays out a set amount each year, about Ј1400 pa I think, which does not affect her benefits or care home fees.
  Nobody needs to do anything once it is properly set up. This was done with the help of a solicitor expert in trusts and a financial advice company to get the best long term investment.
  This was done 15 years ago and works with no intervention. My sister is normally limited to Ј20 spending money a week, which her Home dishes out, but she vaguely knows there is a fund she can access if she needs more. Her daughter has POA and can pay any additional bills from this fund.
  I guess it would have been possible to set the trust fund up to pay out on a monthly basis, which would then not involve anyone else. That would not be a huge amount for your son to cope with.
  If my sister had been given the lump sum, she would have spent it all madly by now, or given it away.
  Apart from setting it up, there is no solicitor involved to eat away the funds.
  When my sister dies, what is left will be divided between her son and daughter.
  Hope this helps.